An era draws to an end. There is a new DEX king. The dYdX Chain, based on Cosmos, has emerged as the new authority of decentralized exchanges [DEX]. Surpassing the established Uniswap, the DEX Chain’s version 4 [v4] achieved a remarkable 24-hour trading volume of $757 million, outpacing Uniswap v3, which recorded $608 million in the same period. This marks a major shift in the DEX landscape.
The momentum leading up to this milestone began a day earlier when dYdX Chain’s trading volumes surpassed those of its v3 after two months. Over 31 epochs, more than 70,000 dYdX v3 users earned approximately 185 million, engaging in activities such as trading, market making, and staking. The success can be attributed to various factors, including user rewards and a focus on achieving 10x outcomes by the platform builders.
David Gogel, Head of Growth & Operations at the DEX, highlighted the significance of community control, empowering traders, liquidity providers, and partners to collectively shape the protocol through over 30 governance proposals. This collaborative effort resulted in a staggering $1 trillion in trading volume on dYdX v3, emphasizing the strength of the dynamic ecosystem.
Governance proposals for dYdX v3 are often centered on emission reduction and reward optimizations. Notably, the community decided to enhance the utility of the governance token by adopting DYDX as the L1 token. Additionally, the transition involved bridging tokens from the Community and Rewards Treasuries, leading to a complete shift in rewards from v3 to the DEX Chain.
dYdX’s Rise To Power
With the implementation of DIP 29, trading and liquidity provider rewards on v3 have been reduced to zero. Meanwhile, traders now have the opportunity to receive up to 90% of fees paid back as trading rewards, along with incentives from the 6-Month Launch Incentives Program. It has quickly made waves, becoming the largest DEX by volume with $18 billion in cumulative volume and an impressive $1 billion+ all-time high in daily volume.
Additionally, there are 43 million USDC deposited as collateral, and over 70% of the total ethDYDX supply has been bridged, with 76 million DYDX tokens staked to validators, offering double-digit annual percentage rates [APRs] in USDC for validators and stakers.